Shufersal profit falls after consumer protests

SaraToth

JERUSALEM -(MarketWatch)- Shufersal Ltd. (SAE.TV), Israel's largest supermarket chain, said Monday its net profit for the third quarter fell 59%, compared with the previous year, to 29 million shekels ($7.8 million), after it lowered its prices to appease public protests against the country's rising cost of living.

Input prices for food products also rose, further eroding profit, the company said. Revenue was ILS3 billion, up 3.8% from ILS2.89 billion in third-quarter 2010, Shufersal said.

The company will continue to run promotions to retain customers and will have to cope with Israel's changing consumer environment, hopefully gradually increasing its profits over the next few years, Rafi Bisker, Chairman of Shufersal's board, said in a statement.

During the summer, thousands of Israelis held demonstration against high living costs resulting in many companies cutting prices and the government proposing measures to reduce the cost of living.

Shufersal is a subsidiary of Discount Investment Corp. Ltd. (DISI.TV), a holding company.

At 1000GMT, shares of Shufersal were down ILS0.49, or 3.24%, and shares of Discount were up ILS0.46, or 0.59%, at ILS27.10, in a higher Tel Aviv market.

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